On February 5, 2016, the Federal Energy Regulatory Commission (“FERC” or the “Commission”) accepted proposed revisions to the Joint Operating Agreement (“JOA”) between PJM Interconnection, L.L.C. (“PJM”) and the Midcontinent Independent System Operator, Inc. (“MISO”) that eliminated the $20 million minimum cost threshold that a transmission facility must meet in order to qualify as an Interregional Market Efficiency Project (“IMEP”)—a designation under the JOA that permits the construction of transmission upgrades between PJM and MISO.

In their December 9, 2015 filings, PJM and MISO stated that they had identified a number of potential enhancements to the metrics and thresholds used for interregional coordination through recently-completed joint planning studies. PJM and MISO identified removal of the $20 million cost threshold as a “short term” reform that would increase their ability to resolve constraints along the PJM-MISO seam.

In accepting the proposed revisions to the JOA, the Commission stated that the removal of the $20 million threshold would “increase the number of potential transmission projects that [PJM and MISO] can consider that could relieve congestion or provide economic benefits along the seam.” While the Commission accepted the proposed revisions, effective February 8, 2016, the Commission noted that the tariff records submitted by PJM and MISO in their December 9, 2015 filings included changes to the JOA that were pending in other proceedings. Accordingly, the Commission made acceptance of the changes related to elimination of the $20 million threshold subject to the outcome of those other proceedings.

A copy of the Commission’s order may be found here.